Externally genitalia aren't the only physical characteristic, and if you judge by other physical characteristics that are testable now, though less obvious to a casual observer, transgender individuals are in many ways similar to their experiences gender more than their socially assigned gender. The biological differences between make and female aren't binary, treating them as if they are is an extreme simplification and treating external genitalia as the bright-line divider is increasingly evidently nonsensical given out knowledge of human biology and it's relation to psychology and behavior.